Wall Street falls, Caterpillar latest to miss on sales
By Caroline Valetkevitch | October 23, 2012 6:14 AM EST
Stocks tumbled on Monday as investors worried that slower global growth is hitting corporate sales despite earnings that beat expectations.
Caterpillar also slashed its 2012 forecast for the second time this year, warning the global economy was slowing faster than it had expected.
With this reporting period, investors are looking at both sides of the earnings story, with earnings beating lowered expectations, but revenues coming in weak and profit warnings staying at a high level.
"The majority of earnings so far have been on the weak side and a number of high-profile companies have issued profit warnings, making investors a little more cautious about the outlook for profits in 2013," said Michael Sheldon, chief market strategist at RDM Financial, in Westport, Connecticut.
Of the 123 S&P 500 companies that have reported results, 60.2 percent have topped analysts' expectations for earnings, but 61 percent have missed revenue forecasts, according to Thomson Reuters data.
Third-quarter earnings are expected to fall 2.4 percent from a year ago, according to Thomson Reuters data.
The S&P 500 broke below its 50-day moving average around 1,434, which had proven to be a strong support level. A lasting break below that level could signal further declines.
Mining company Freeport-McMoRan
The Dow Jones industrial average <.DJI> fell 84.70 points, or 0.64 percent, at 13,258.81. The Standard & Poor's 500 Index <.SPX> dropped 8.80 points, or 0.61 percent, at 1,424.39. The Nasdaq Composite Index <.IXIC> slipped 3.69 points, or 0.12 percent, to 3,001.93.
Nine of the 10 industry sectors in the S&P 500 were lower, with only information technology higher, in part because of Apple's advance. Other tech gainers included Oracle
Coal miner Peabody Energy Corp's
After the closing bell, earnings reports are expected from Yahoo Inc
(Reporting by Caroline Valetkevitch; Additional reporting by Leah Schnurr; Editing by Jan Paschal)